Is this Chicago's next Bucktown?

Leo Tropeano lived in New York for years, but when he was ready to put up his first retail store selling denim for men, called Mugsy Jeans, he chose Chicago's emerging Fulton Market neighborhood. For now, many of the former meat and produce warehouses around his storefront at 1118 W. Fulton are vacant, with either "Sold" or "For Sale" signs posted, and the foot traffic is light during the day.

But as Google brings more workers into its Midwest head office around the corner and McDonald's builds its global headquarters nearby, Tropeano is betting that his part of the West Loop will become Chicago's next Bucktown. Like West Randolph Street, two blocks south, Fulton Market will have more than its share of restaurants. It's also turning into a more multidimensional commercial strip, as national chains and independent retailers tiptoe in.

R2, for instance, is redeveloping the former Isaacson & Stein fish market at 800 W. Fulton; the property's 25,000 square feet, spread over four stories, are expected to be ready for occupancy by early next year.

"We're talking to both retailers and restaurants who want to be here," says Matt Duhig, R2's director of leasing and a principal. "Two years ago there was no market at all for retail here. Now retailers are telling us that if this area is good enough for Google, it's good enough for us."

Duhig likens Fulton to the Chelsea district in New York, where a bubbling mix of restaurants, retail, residential and office has largely crowded out the old tenements and warehouses that once dominated the area. He predicts that Fulton also will look quite different from Randolph in a few years: "Randolph will always be attractive to restaurants. But Fulton has the ability to attract a much wider pool of tenants."

At a building R2 owns at 800 W. Washington, Duhig says, a health club tenant is in talks to take space. At a condominium mid-rise at 1000 W. Washington, R2 is talking to a day care center about taking over a 17,000-square-foot ground-floor space. "This is turning into the hottest real estate market in the city," he says.

No surprise then that rents are escalating rapidly. For restaurateurs and apparel retailers, current asking prices range from $70 to $100 a square foot. That's less than the rents in Bucktown, which range from $130 to $170, retail brokers say, yet Bucktown is a much more mature commercial district with greater density of foot and car traffic.

"The foot traffic is already beginning to take hold on Fulton. Google's arrival there has put it in the middle of the action," says Michael Bell, a retail broker who owns Pentad Realty and who is not working in the area now.

Some tenants in the area worry that rents have gotten so high that independent merchants, like Mugsy Jeans, won't be able to afford storefronts. "I hope that doesn't happen," says Roderick Burch, executive director of the West Central Association, a group of local merchants. "We hope that smaller, boutique-style shops are able to find space in the area. Anything that is locally owned resonates with residents and shoppers in a special way."

As for Tropeano, he's hoping his little shop, at less than 1,000 square feet embellished by masculine accoutrements such as a bar and pinball machine, is the first of a chain of Mugsy Jeans shops. "I'd like to have stores in Los Angeles, San Francisco and Austin, Texas, eventually," he says. "But this store will be our flagship, our model for the future."

And if the store doesn't pay off, Tropeano still could make a go of it in Fulton Market—he owns the storefront.